In 2024, the Portuguese National Health Service (SNS) underwent a major structural reform. Central to this reform was the expansion of Local Health Units (ULS) and the adoption of a capitation-based funding model, replacing the previous activity-based contracts. This article critically examines the design and early implementation of the new funding model, highlighting its theoretical strengths -particularly in promoting efficiency and care coordination - while identifying practical limitations that may undermine its effectiveness. These include challenges in risk adjustment, outdated costing structures and weak enforcement mechanisms. While the reform is a relevant step to align incentives in the health system, its long-term success will depend on technical refinement and its concrete implementation at a local level.
Eduardo Costa (Wed,) studied this question.